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Research Report
Contents
Section 1: Introduction ................................................................................................................................. 1 Introduction to Ready to Eat (RTE) ....................................................................................................... 1 Background for the Study ......................................................................................................................... 1 Concept ..................................................................................................................................................... 1 Some Features: ......................................................................................................................................... 2 Motivation for the Study........................................................................................................................... 2 Objectives of the Study ............................................................................................................................. 2 Research Problem ..................................................................................................................................... 2 Scope of the Study .................................................................................................................................... 3 Limitations of the Study ............................................................................................................................ 3 Defining the Variables ............................................................................................................................... 3 Section2: Literature Review .......................................................................................................................... 4 Theoretical Review.................................................................................................................................... 4 Introduction .............................................................................................................................................. 4 The current scenario ................................................................................................................................. 4 Market....................................................................................................................................................... 4 Challenges ................................................................................................................................................. 5 Research Based Literature Review................................................................................................................ 6 Research Paper Abstracts ..................................................................................................................... 6 Ready To Eat Food Industry ...................................................................................................................... 6 Ready Meals in Pakistan to 2013 .............................................................................................................. 6 Highlights .................................................................................................................................................. 6 Reasons to Purchase ................................................................................................................................. 6 Article Abstracts ............................................................................................................................................ 7 Food Industry ............................................................................................................................................ 7 Cooking made convenient .................................................................................................................... 7 Source: Research report on Retort Packaging ...................................................................................... 7 MARKET & ITS GROWTH ....................................................................................................................... 8 Source: www.marketingpractice.blogspot.com ................................................................................... 8 Ready to Eat: Processed and packaged foods ...................................................................................... 8 Section 3: Research Methodology ................................................................................................................ 8 ii
Research Design ........................................................................................................................................ 8 Steps in the research: ........................................................................................................................... 9 Data collection Methodology ................................................................................................................... 9 Primary data .......................................................................................................................................... 9 Secondary data ..................................................................................................................................... 9 Sample design ........................................................................................................................................... 9 Tools & Techniques ............................................................................................................................... 9 Sample Size ............................................................................................................................................... 9 Questionnaire response over using SPSS ................................................................................................... 10 Overview of Data ....................................................................................................................................... 10 Initial Question ........................................................................................... Error! Bookmark not defined. Likeret scale s Questions .......................................................................... Error! Bookmark not defined. Personal Info .............................................................................................. Error! Bookmark not defined. Valuation of Data Using T-Test ................................................................................................................... 14 RESULTS & FINDINGS .................................................................................................................................. 20 Results from the series of above questions: ............................................................................................... 28 CONCLUSION............................................................................................................................................... 29 Recommendations ...................................................................................................................................... 30
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Section 1: Introduction
Introduction to Ready to Eat (RTE)
Concept
Ready to Eat Meals (RTEM) are partially prepared meals and they are relatively new products in subcontinent as compared to western countries. What customer needs to do is just to open the item pouch and either places it in the microwave oven to heat or place it in warm water for some time and then serve to eat. Earlier these ready to eat meal provided to soldiers in army so that they can eat it any time and place without cooking utensils. The potential for growth in the market is quite considerably good and according to January 2010 estimates its worth Rs 50 million annually. There are two main reasons for this growth, one is the population and the other is the improvement in consumers spending ability. The ready-to-eat segment is growing at a good pace. Two major Players in the Ready to Eat Segment will be Shan National
Some Features:
Globalization of Pakistani food and its people living abroad in different countries of the world considered as the major factors for popularization of ready to eat foods. Major factor for motivation of ready to eat foods is the foreign market which is growing very fast. Retail outlet culture is also increasing rapidly in Pakistan. Life of these food items is about 12 to 18 months. Their features such as Quality, essence and aroma of these foods remain fresh up to the expiry date. Women wanting to spend more time out of the kitchen. Increasing white choler bachelors staying away from homes.
Research Problem
This Study deals with the Ready to eat Industry in Pakistan. The study also aims at understanding the factors influencing buying decision making of the RTE packs. The factors under consideration are advertising, price, Product, Value proposition etc.
Market
There is a huge untapped market opportunity arising due to rapid demographic shifts in income, urbanization, and proportion of urban working women in India. The industry needs to concentrate on broadening the market and increasing penetration amongst Indian consumers.
The analysis also pointed out that industry players would have to significantly improve their price competitiveness with respect to other options such as domestic help, eating out and ordering in,
available to the Pakistani consumer. Besides price consideration, the product range offered by industry players will have to strengthen.
Challenges
Most urban families are strapped for time. So I would conclude that the RTE foods would be a necessity, however, this is not the case. The Rs 500 million markets have stayed stagnant over the past three years. That's because in Pakistan people still believe in cooking and serving food. Additionally, The RTE foods have to compete with restaurants, cooks and consumers penchant for cooking. Over and above, the pricing is higher range which has made it an occasional purchase item rather than regular buying.
Highlights
The market for ready meals in India increased at a compound annual growth rate of 13.7% between 2003 and 2008. The canned ready meals category led the ready meals market in Pakistan, accounting for a share of 60.3%.
Reasons to Purchase
Develop business strategies by understanding the quantitative trends within the ready meals market in India Design effective marketing and sales strategies by identifying key market categories and segments Identify key players within the market to plan lucrative M&A, partnerships and agreements
CS Market Research report Country: India The project report gives a detailed analysis of the Indian food processing industry. The factors influencing the growth pattern is attributed to the rapid expansion of the retail distribution system replacing mall stores and wet markets with modern supermarkets, superstores and convenience stores. Domestic processed food consumption will continue to grow as Indias population increases, and as incomes increase and lifestyles change, a higher proportion of processed food and beverages are included in the diet. The consumer food industry mainly consists of ready-to eat or ready-to-cook products such as noodles, cocoa based products, bakery products, biscuits, soft drinks, and snack food.
Article Abstracts
Food Industry
Source: http://www.indianfoodindustry.net/ The article deals with the Indian food processing industry. There is an opportunity for large investments in food and food processing technologies, skills and equipment, especially in areas of Canning, Dairy and Food Processing, Specialty Processing, Packaging, Frozen Food/Refrigeration and Thermo Processing, Fruits & Vegetables, Fisheries, Milk & Milk Products, Meat & Poultry, Packaged/Convenience Foods etc This shows that there is large scope for growth for RTE industry and studying the factors influencing the industry and industry should consider all these factors to get a share of the growing RTE market. Cooking made convenient Source: The Hindu This article elaborates on the need for Ready to Eat foods. It also discusses how RTE has penetrated In the retail distribution network. It also discusses the various competitors in this segment and the pricing strategy on these companies. Source: Research report on Retort Packaging Ready to Eat Meals like already cooked or prepared lunch & dinner are relatively new products which came in market only a few years back and now sold through retail general stores in especially made sealed aluminum laminates.
The popularity of ready to eat packed food now is no longer marks a special occasion. Peoples want value for time, money in terms of quality and variety. The food processing industry is one of the largest industries in India and it is the ranked fifth in terms of Production, Consumption, export & Expected growth.
Source: www.marketingpractice.blogspot.com
According to ITC press release on March 2008, Indian RTE market is worth around Rs 80-100 crore. The market is somewhat in a stagnant state and the growth is minimal. This article deals with the rising prices issue that might have an impact on the RTE industry. Ready to Eat: Processed and packaged foods Source: www.garamchai.com This article discusses the take off of ready to eat industry due to demand from NRIs. It also lists the various players in this segment along with their product offering. The article states in spite of the stagnant growth in Indian market the companys sales are fast gaining momentum due to the sales driven by NRI market.
Steps in the research: Found out the research problem and collect the data of secondary to draw the path for research study. Regarding research problem search out articles, essay writing, and book on this research study. Primary data would be collected through questionnaire and one to two interviews with executives one. After having, these data compile them in a proper format to analyze it. Then found out research and findings. Then conclusion and recommendation will give in the last of this research.
Sample design
The sampling technique non-probability used. In addition, sample would be chooses on convenience based. A sample size consists of 200 respondent but 50 of them are completely unaware of this RTEM food, so it needs to discarded, conclusion were taken from 150 responses by mixture of respondent. Respondent are mostly from Karachi.
Tools & Techniques Data collected through primary and secondary study. Moreover, data would analyzed by SPSS, EXCEL and word office software. Thorough excel I bought the graphs and from SPSS I got one sample t-test, descriptive analysis and finally correlation test.
Sample Size
A sample size consists of 200 respondent but 50 of them are completely unaware of this RTEM food, so it needs to discarded, conclusion would taken from 150 responses by mixture of respondent. Respondent are mostly from Karachi.
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Descriptives
Descriptive Statistics N Given a normal week, are meals (i.e lunch & dinner) cooked at home for 150 Range 3.00 Minimum 1.00 Maximum 4.00 Mean 1.7533 Std. Deviation .75916
On days when meals are not cooked at home, how do you manage?
150
2.00
1.00
3.00
1.9733
.63401
150
1.00
1.00
2.00
1.0133
.11508
150
1.00
1.00
2.00
1.6533
.47750
150
1.00
1.00
2.00
1.6533
.47750
How did you come to know about the Ready To Eat Packs
150
3.00
1.00
4.00
1.8400
1.11776
"A Ready To Eat Pack saves a lot of time and effort in cooking"
150
4.00
1.00
5.00
1.6467
.86028
150
4.00
1.00
5.00
3.0533
.96089
150
3.00
1.00
4.00
2.4067
1.06246
150
3.00
1.00
4.00
2.9733
.93368
150
3.00
1.00
4.00
2.0400
.66434
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money
150
3.00
1.00
4.00
2.2867
.83011
I know that the RTE Packs are manufactured at best quality standards
150
3.00
1.00
4.00
2.3600
.77961
I will surely use more RTE Packs if ready to eat rotis are also made vailable
150
3.00
1.00
4.00
2.1867
.95106
150 150
2.00 3.00
2.00 1.00
4.00 4.00
2.5867 1.9800
.80424 .68021
Occupation
150
3.00
1.00
4.00
1.3400
.62208
150
5.00
1.00
6.00
1.5200
1.00148
150
5.00
1.00
6.00
2.5667
1.05179
Valid N (listwise)
150
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One-Sample Test Test Value = 0 95% Confidence Interval of the Difference Mean t Given a normal week, are meals (i.e lunch & dinner) cooked at home for 28.286 df 149 Sig. (2-tailed) .000 Difference 1.75333 Lower 1.6308 Upper 1.8758
On days when meals are not cooked at home, how do you manage?
38.120
149
.000
1.97333
1.8710
2.0756
107.843
149
.000
1.01333
.9948
1.0319
42.406
149
.000
1.65333
1.5763
1.7304
42.406
149
.000
1.65333
1.5763
1.7304
How did you come to know about the Ready To Eat Packs
20.161
149
.000
1.84000
1.6597
2.0203
38.918
149
.000
3.05333
2.8983
3.2084
15
27.743
149
.000
2.40667
2.2352
2.5781
39.002
149
.000
2.97333
2.8227
3.1240
37.609
149
.000
2.04000
1.9328
2.1472
33.737
149
.000
2.28667
2.1527
2.4206
I know that the RTE Packs are manufactured at best quality standards
37.075
149
.000
2.36000
2.2342
2.4858
I will surely use more RTE Packs if ready to eat rotis are also made vailable
28.159
149
.000
2.18667
2.0332
2.3401
Personal Data
age group 39.391 149 .000 2.58667 2.4569 2.7164
marital status
35.651
149
.000
1.98000
1.8703
2.0897
Occupation
26.382
149
.000
1.34000
1.2396
1.4404
18.589
149
.000
1.52000
1.3584
1.6816
29.887
149
.000
2.56667
2.3970
2.7364
As it is clear from the above one sample t-test that data which I gathered could concluding that all null hypothesis would rejected at 5% significant level. To make our result confirm with more authenticated operation that is correlation, which make sure about our results findings are true.
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Co-Relation Test
H1o. Convenience doesnt affect the demand for RTEM. H1a. Convenience affects the demand for RTEM
here I took the hypothesis that is convenience effect the demands or not, so to check this one out I have taken two question from agreeable scale. One is about availability and another is about value for money and it is clear from the above correlation test that value for money is rejected and yes convenience does effect on DEMAND.
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H1o. Convenience doesnt affect the demand for RTEM. H1a. Convenience affects the demand for RTEM
To make this point more clearly I put another question that is about savings a time with this RTEM, and again I are on the same result that convenience does affect on the DEMAND.
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H2o. Product Features dont affect the demand for RTEM. H2a. Product Features affect the demand for RTEM.
Another Hypothesis which I need to discuss is about product features influence on RTEM Demand. When to look into the correlation table I have seen that, the quality and the taste would be statistically significant at 0.01 significant levels. Therefore, I could conclude that yes features of the Food does effect on RTEM Demand. Because people still look for the sufficient amount and shape of the food rather then its quality and taste.
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The pie chart above interprets a desi Pakistani households mentality of cooking food at home almost on all days (65% of respondents), and 25 % of respondents cooking on week days.
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15%
We visit a resturant
70%
10
20
30
40
50
60
70
80
This one also shows our mentality that I want to visit to outside from our houses if and only cook are not at home. In addition, I see that people tend to choose more than one answer but I restrict them to choose one.
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30%
Yes 70% No
When I start to collect the primary data by questionnaire then it found that most of the people didnt understand the difference between frozen foods and RTEM foods, therefore I discarded 50 questionnaires regarding this. In addition, rests were very much aware of these RTEM.
35%
65%
Yes No
65% of them were agree with the question and 35% gives in negative
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30% While shopping for MONTHLY GROCERY items 70% Separately DURING EMERGENCY
70% will have RTEM while shopping for monthly grocery items and 30% will have in emergency. It noted that these people were aware of RTEM.
Word of Mouth
15%
Tv Commercials
15%
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As it seen from above chart that RTEM are only at big malls, so not everyone can access it but the niche market will access it. Therefore, it is better to increase the availability of the product
20
20
24
25
40
50
20
I think home made meals are more fresh then RTE pack cooked
Strongly Agree Agree Niether Agree or Disagree 30 70 10 30 10 Disagree Strongly Disagree
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I will use RTE Packs if ready to eat rotis are also available
Strongly Agree Agree Niether Agree or Disagree Disagree 40 70 10 10 20 Strongly Disagree
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CONCLUSION
From above all discussion, I are now to conclude our research report with the following findings: Price- Pakistani people are very much pricing sensitive, they still want Mercedes in 8 lacs. In order to advertise RTEM this one should be in your mind that you have to make viewers to believe that RTEM is the value for money.
Value proposition RTEM is always perceived as the value proposition, and
what value proposition is all about , it is that customers want their cost worth, what they spend will have more than that. The same is the case here in term of RTEM that people expect more then what is provide now.
Value for money The main competitors of the RTEM are the restaurants,
because respondent feel the worth for money while spending at the restaurant, so there for Industry of can food must have to sure that what customer spend will get more than that. While having walk-in interviews it was also found that people dont like to spend more on RTEM because they dont felt them the value for money Quantity and taste of food - Pakistanis love to eat DESI food, most specially at Punjab side people love spicy food. Respondent dont look for the quality they just want sufficient quantity which make sure of complete meal to them, thats why I the Pakistani wont let the meal down until abdomen is about to blast. Manufacturing conditions our respondents are the mixture of educated and non-educated people, so educated respondent were taken much care about manufacturing condition, their main concern is of their health in this fast pace of life. So it should be make sure that quality would be best if your target market is working women because they are educated. Easy availability As I discussed earlier that main competitors for RTEM are restaurants, and they provide at most easy way, mostly restaurant have free delivery at home. So availability is to be considered as one of the important factor while launching RTEM.
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Recommendations
As per our research, the following recommendations should be practice by the Food Industry in order to make their plan of RTEM most successful: It is clear from the above results that Pakistanis are now more aware of what is bad and what is good for them and one major cause are that they considered RTEM as not good for health, so can food manufacturer has to use this point in their advertising and promotion strategies. It needed to aware people about the freshness of RTEM . It is seen that 100 respondent were agree that RTEM foods are not as fresh as homemade meal. Now this would be the major threats for food industry to divert the mind of respondent towards the RTEM as a fresh food and taste is same as house made meals even much better. They should Focuses on its strength as well like time saving, every time ready, in case of emergency, availability. This would be enlightened again n again in their advertising strategy and in ads campaigns. It is because the targeted people are working women and of course after having a long and tiered day it would not able to make meal manually so they must be impressed by your strength. From the results, it is very much clear that people are more concerned with price as well; they judge the product by first looking at the price of the product. Therefore the pricing strategy should be arrange in a way so that everyone can have this opportunity and easily accessible by them. It proved that people mostly aware of this product would found RTEM at shopping malls, and about to nothing will have on television and word of mouth. So it shows that availability factor is very week, in order to increase awareness first of all choose the one of the best method that ads on television which will increase the awareness with in no time because everyone have TV set and cable network connection in it. The second most important way to increase awareness is word of mouth as far as people are concerned they are also having the product by motivating his or her friend, so word of mouth will generate positive word of mouth which increases the awareness.
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Bibliography
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